Yeah, he was a villain, but not a DUMB one, at least until he decided to invade Kuwait.

In a now famous interview with the Iraqi leader, U.S. Ambassador April Glaspie told Saddam,

‘[W]e have no opinion on the Arab-Arab conflicts, like your border disagreement with Kuwait.'

The U.S. State Department had earlier told Saddam that Washington had ‘no special defense or security commitments to Kuwait.' The United States may not have intended to give Iraq a green light, but that is effectively what it did."

http://www.foreignpolicy.com/posts/2011/01/08/wikiileaks_april_glaspie_and_saddam_hussein